Cash on Delivery

Cash on Delivery

The business of the company had become extremely various. Money, jewellery, goods, packages, presents, and daguerreotypes were sent to any point in the country. Bills, notes, drafts, and accounts were collected and paid.

In this connection the American Express Company had already made the first of its many contributions to the improvement of commerce by inventing the C.O.D. system of delivery, which enabled merchants shipping goods to customers to have the Express Company collect the price for them.

On the day of its opening the new headquarters was the largest privately owned building in New York. The directors of American Express, who were no tyros when it came to publicity, did things up in style, with bands playing and a gala parade, the grand climax of which was the directors themselves riding in a glittering, extra-size express wagon drawn by ten of the magnificent horses of which they were so justly proud.

Incidentally, when the Prince of Wales, later King Edward VII, paid his historic visit to New York in 1860, it was the American Express Company which provided the proud steeds and glittering carriages in which he made his triumphal passage up Broadway.

In that year, 1858, the American Express Company made its first brief entrance into the business which is now one of its major concerns. The directors, seeking always for new enterprises, noted that William F. Hamden had made excellent profits by arranging the passage of immigrants from Europe and directing them to industrial establishments in various parts of the country which were in need of man power. They decided that they, too, would get into the travel business and accepted the agency of the Atlantic Royal Mail Steam Navigation Company, a line of New York and Galway steamers. To handle this business they hired Mr. S. Dewit Bloodgood at "a compensation of one fifth the net profit of the agency, the same to equal £20 per month."

Four months later Alexander Holland, the treasurer of American Express, reported that the company had made a net profit of £603 on the agency and recommended opening exchange accounts in Europe and continuing the contract. Again John Butterfield was in a negative mood. He considered the profit too trifling to bother with and moved that the American Express request the steamship line to make other arrangements. The motion was carried.

It was more than fifty years before American Express was again officially in the travel business.

In 1859 the American Express Company, flourishing and expanding every day, with a business amounting to millions of dollars a year, a prodigious establishment of express routes, agencies, depots and offices, thousands of employees, and hundreds of shiny express wagons and well-groomed horses, faced a dilemma. Its ten-year span of life, provided in the original articles of association, had about run out.

On September 1 the directors gathered at the fine new mansion Henry Wells had built for himself in Aurora, New York, to decide on a method of procedure. After much discussion and legal advice it was considered advisable to dissolve the old company and form a new one.

Johnston Livingston was directed to draw up a letter to the stockholders informing them that the American Express Company would be sold, lock, stock, and barrel, buildings, routes, money and notes, horses and wagons, at public auction. However, the stockholders were invited to attend a meeting to form a new company which would attempt to bid in the old.

This was done, and one Aaron Freeman was authorized to purchase the property of the American Express at any sum not exceeding £750,000. In due legal form the company was dissolved on December 31, 1859. That same day the auction was held at the Hudson Street building, and the whole company was knocked down to Mr. Freeman for £600,000.

After the auction was over and the company safely back in the hands of its stockholders, "an ample lunch was furnished by the directors." What a scene of dignified revelry that New Year's Eve meal must have presented! What vast quantities of turkeys and hams, great twelve-rib roasts of beef, and splendid shoulders of mutton disappeared down the gullets of those hearty expressmen and their equally voracious stockholders! How their voices rang out as they drank to the future of the new company - a future that even at the height of their enthusiasm they would not have dared to predict.

For more on Small Business Corporate Structure

What next? The Expressmen's Picnic

The Expressmen's Picnic

Despite the problems and uncertainties of the express business, it continued to be highly profitable. By 1854 the capitalization of the company had risen from a meek £150,000 to a robust £750,000. The company was vigorously expanding in all directions, and Gleason's Pictorial Drawing Room Companion for January 1854 states: "At the head of the express companies doing a domestic business stands the American Express Co., Wells, Butterfield & Co., Livingston Fargo & Co., proprietors. Their messengers move from twelve to fifteen thousand miles per day, traversing some dozen or more different states and territories. . . . There is no more reliable and responsible company in the world than the American Express Company . . and it deserves unlimited public confidence for its promptness and fidelity."

The same magazine goes on to describe the annual expressmen's picnic held on Christmas Day, 1853. All the express companies took part in the dashing... see: The Expressmen's Picnic

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